Property Valuation
An appraiser in Wisconsin adjusts a comparable sale price upward because the comparable has less square footage than the subject. This is a:
ANegative adjustment to the comparable
BPositive adjustment to the comparable✓ Correct
CPositive adjustment to the subject
DNo adjustment; square footage differences are not relevant
Explanation
When the comparable is inferior to the subject (less square footage), the appraiser makes a positive (upward) adjustment to the comparable's price to make it more equivalent to the subject.
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Key Terms to Know
Short Sale
A sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Math Concepts
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